Tuesday, February 12, 2013

Parks Associates Looks at Engaging Consumers in Home Energy Management

What are the best business plays for providing energy management services in the home? If you’re with a utility rolling out energy-saving smart grid programs or looking to sell energy management systems in the mass home market, you may want to trek to San Antonio, Texas for the Parks Associates Smart Energy Summit April 25-27.

We got a peek at the kind of info that will be offered at the summit, through a webinar, Business Models for Energy Services, hosted by Tom Kerber, Parks’ Director of Research, Home Controls & Energy.

Here are some key takeaways:

More Consumer Engagement is Needed
Consumer familiarity with energy programs is declining, from 27 percent in 2010 to 17 percent in 2012, and Kerber thinks that may have something to do with more familiarity when economic stimulus programs behind utility efforts were in effect. However, he adds, “That they’re offered broadly but that consumers aren’t aware does not speak well to consumer engagement,” he says.

Yes, Some People Want Energy Monitoring
Parks finds that those product owners who have a high appeal of energy monitoring include those with:

Solar panels – 54%
Controller for water heater – 44%
Devices for light automation – 44%
Plug-in back up generator – 30%
Programmable thermostat – 36%
Overall, Kerber around 32 percent have a high appeal of energy monitoring.

But Will They Look at It?
Data suggests that people don’t want to look much at their energy usage, and Kerber says a way to get people more interested is disaggregation, or breaking it out by devices such as appliances and lighting. Having that data breaks down misconceptions of energy use, and once people and utilities have that info they can attack the real energy hogs. Companies such as Bidgely and Onzo have services that do this. It can also be done by circuit-level energy monitoring inside the home.

And Monitoring Works!
Kerber reports that the American Council for an Energy Efficient Economy (ACEEE) looked at 36 programs and found that with more information about energy usage, potential resource savings went up (see graphic).

Enhanced billing – 3.8%
Real-time feedback to appliance level – 12%
Real-time plus smart program design – 20-35% savings
More Standards?
Demand response programs don’t generate a lot of interest among consumers, and data suggests it’s due to a lack of value proposition for consumers. However, Kerber believes a lack of communications standards has an energy bigger effect on a highly fragmented smart grid market. He says the leading technology is not used by 10 percent of utilities. We’ll see if ZigBee Smart Energy Protocol (SEP) 2.0, which is IP home network-friendly, works out. That will be one of the topics of discussion at Parks’ Smart Energy Summit.

What Will People Pay?
For equipment required to participate in utility cost saving programs:

50% would pay about $60
10% would pay $200
It may not seem like much, but that 10 percent, Kerber says, is not insignificant. The value proposition is also in the context.

Security + Energy = Success?
Security and energy are intertwined, especially from a consumer perspective. Here’s what Parks Associates reports on the appeal of specified services:

Security – 18%
Energy 17%
Both – 30%
The idea of a security platform adding energy is why big service companies like ADT, Comcast, Verizon, Vivint, Alarm.com and others are in the space, primarily offering security and connect home systems with some smartphone energy management of thermostats and lights.

Now we’re seeing alignments like San Diego Gas & Electric and Alarm.com for a pilot demand response savings program for Alarm.com’s emPower thermostat users, as well as Southern California Edison providing home energy management and monitoring through ADT’s Pulse.

From the article, "Parks Associates Looks at Engaging Consumers in Home Energy Management" by Steven Castle. 

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